The Associated Press reports the White House and House Republicans have identified areas of significant overlap that could form the basis for an agreement after posturing gives way to actual bargaining.

The Wall Street Journal: GOP Deficit Plan Irks Conservatives
The conservatives’ attitude could nonetheless complicate Mr. Boehner’s mission as he strives to negotiate with a re-elected Democratic president without losing so many Republican votes that his leadership would be in peril. GOP leaders said the criticism underscores how much Mr. Boehner’s proposal was an attempt at compromise, while Mr. Obama’s proposal, which would raise $1.6 trillion in new taxes, was not (Bendavid and Lee, 12/4).

The Associated Press/Washington Post: Hot Rhetoric Aside, There’s Overlap In Competing Fiscal Offers That Could Form Basis Of A Deal
Both sides now concede that tax revenue and reductions in entitlement spending are essential elements of any deal. If the talks succeed, it probably will be because House Speaker John Boehner yields on raising tax rates for top earners and the White House bends on how to reduce spending on Medicare and accepts some changes in Social Security (12/4).

Los Angeles Times: Republicans Drop Ryan Budget Plan In ‘Fiscal Cliff’ Negotiations
The austere federal budget plan drafted by Rep. Paul D. Ryan and embraced by Republicans as a sweeping reimagining of government has hit a roadblock on the way to the so-called fiscal cliff. Top Republicans, including Ryan, insisted this was not the end of the plan and pledged to “support and advance” its principles. But by sidestepping the plan, the House leadership sidelined the push for a transformative overhaul of federal entitlements — a move that quickly sparked dissent from the party’s conservative wing (Mason and Mascaro, 12/5).

The Washington Post: Governors Urge Obama, Lawmakers To Avoid ‘Fiscal Cliff’
Although some federal programs especially key for states — notably Medicaid — are exempt, many other federal grants to states would be cut. The Pew report said 18 percent of federal grant money would be subjected to the automatic hit. That includes Title I funding, which covers education programs for the poor and the disabled, medical research money, and health and human resource programs (Fletcher and Helderman, 12/4).

Stateline: In Fiscal Cliff Talks, Governors Get White House Seat
A bipartisan group of governors has called on Washington to find a solution — any solution — to the nation’s budget woes as the federal government nears its so-called ‘fiscal cliff.’ “It’s not acceptable to have failure when it comes to the fiscal cliff,” said Utah Republican Governor Gary Herbert, following a meeting Tuesday (December 4) with President Obama and five other governors. “We need the good people on both sides of the aisle to come together.” The governors — three Republicans and three Democrats — said they left the White House meeting feeling “encouraged” that Obama would strike a deal with Congressional Republicans before December 31, the date that would trigger a series of spending cuts and tax hikes to deal with the federal deficit but that economists say would plunge the nation back into recession (Clark and Malewitz, 12/5).

CQ HealthBeat: Governors Want To Be Heard In Fiscal Cliff Fight
Democratic and Republican governors who met Tuesday with the president and congressional leaders said they want a seat at the table when negotiations occur on spending cuts and major changes in health programs that could upend their state budgets. The bipartisan National Governors Association gave few specifics in a conference call with reporters after their meeting with President Barack Obama. The governors were equally vague when they spoke to reporters at the White House after their meeting with the president. But the state leaders said they want to be sure they’re not shut out from the deal-making among the White House and congressional Republicans and Democrats (Norman, 12/4).

This is part of Kaiser Health News‘ Daily Report – a summary of health policy coverage from more than 300 news organizations. The full summary of the day’s news can be found here and you can sign up for e-mail subscriptions to the Daily Report here. In addition, our staff of reporters and correspondents file original stories each day, which you can find on our home page.